Understanding the Restaurant Revitalization Fund and 7 Tips to Ease the Application Process
- Apr 28, 2021
The American Rescue Plan Act, passed on March 22, 2021, has appropriated $28.6 billion to the Restaurant Revitalization Fund. This fund will provide support to eligible restaurants, bars, and other similar places of business that serve food or drink. This fund comes in addition to the Paycheck Protection Program (PPP) and Employee Retention Credits (ERC).
The following are highlights of the Restaurant Revitalization Fund:
- Eligibility and Priority in Awarding Funds – Businesses that are not permanently closed and meet some basic criteria are eligible to apply for assistance from the Restaurant Revitalization Fund. During the first 21 days of the program, the Small Business Administration (SBA) will accept applications from all eligible applicants but they will only distribute funds for applications meeting certain eligibility requirements (businesses owned by women, veterans or socially and economically disadvantaged individuals). From Day 22 until the fund runs out, they will accept applications from all eligible applicants and distribute funds in the order they were approved by the SBA.
- Certification – Similar to the PPP, an applicant must make good faith certifications, one of which is “current economic uncertainty makes this funding request necessary to support the ongoing or anticipated operations.”
- Funding Calculation – The grant is to make up for revenue losses by subtracting 2020’s gross receipts from 2019’s and then reducing that amount by any PPP loans received. The maximum funding amount is $5 million per location (not to exceed $10 million total for the applicant and any affiliated businesses).
- Eligible Uses of Funds – The uses are somewhat similar to PPP’s qualifying payroll and non-payroll costs, with additions: for example, both P&I on business mortgages, P&I on business debt service, business maintenance expenses, business food and beverage expenses, covered supplier costs, and business operating expenses. One caution: The same expenses cannot also have been used to claim forgiveness for the PPP loan.
- Timeframe for Using Funds – Funds must be used by March 11, 2023 on eligible expenses incurred beginning on February 15, 2020 and ending on March 11, 2023.
- Validation of Use of Funds – Applicants are required to report through the application portal how much of their award has been used against each eligible use category by no later than December 31, 2021.
Tips To Ease the Application Process
There are three ways to apply to the Restaurant Revitalization Fund: through a recognized SBA Restaurant Partner, through SBA directly at restaurants.sba.gov, or by calling 844-279-8898. These funds are expected to go quickly and it is important to be prepared prior to beginning an application. Here are seven things to keep in mind when preparing for and submitting the application.
- The application process opens on Monday, May 3, 2021 at 12 p.m. eastern. Applicants can register for a login as early as Friday, April 30, 2021 at 9 a.m. eastern.
- This application should be prepared consistent with any PPP application that has been previously submitted.
- The average time to complete the application is 25 minutes. You can save and come back to it; however, others that are online and submitting are passing you in line.
- The person signing the application is the one that needs to be completing the application as there will be security questions that only that person can answer.
- Have your documents that will be required to be uploaded prepped and ready at the time of application. Talk to your CPA and make sure you have the most recent and up-to-date information, as inaccurate information will delay SBA approval and push you back in line.
- Check the size of your files prior to uploading them. The maximum file size is 35 MB per document. If files are larger than that, the system will not accept them.
- Complete the paper application as a draft in preparation to complete the online application. This will make the online process go much quicker.
If you have any questions, we'd like to hear from you.
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